SCAPIN-1008: LIMITATION OF ACTIVITIES OF AND REQUIRING OF REPORTS FROM CERTAIN CONCERNS
GENERAL HEADQUARTERS
SUPREME COMMANDER FOR THE ALLIED POWERS
APO 500
8 June 1946
AG 004
(8 Jun 46)
ESS/AC
(SCAPIN-1008)
| MEMORANDUM FOR | IMPERIAL JAPANESE GOVERNMENT. |
|---|---|
| THROUGH | Central Liaison Office, Tokyo. |
| SUBJECT | Limitation of Activities of and Requiring of Reports from Certain Concerns. |
1. Reference is made to the following Memoranda for the Imperial Japanese Government from General Headquarters, Supreme Commander for the Allied Powers:
a. AG 319.1 (22 Oct 45) ESS/IE (SCAPIN-177), subject: “Reports to be Made by Certain Business Firms.”
b. AG 004 (31 Oct 45) ESS (SCAPIN-215), subject: “Sale or Transfer of Securites of Certain Business Firms.”
c. AG 004 (8 Dec 45) ESS/AC (SCAPIN-403), subject: “Establishment of a Schedule of Restricted Concerns."
d. AG 300.8 (8 Dec 45) ESS/AC (SCAPIN-408), subject: “Regulations Affecting Restricted Concerns.”
e. AG 123 (15 Jan 46) ESS/FI (SCAPIN-599), subject: “Restriction on Dividend Payments.”
f. AG 319.1 (19 Jan 46) ESS/AC (SCAPIN-625), subject: “Reports to be Made by Certain Business Firms.”
g. AG 150 (23 Feb 46) ESS/AC (SCAPIN-767), subject: “War Damage and Government Indemnity Claims of Companies on the Schedule of Restricted Concerns.”
2. The Imperial Japanese Government will take immediate action to assure that the subsidiaries of Daiwa Industrial Company, Ltd.: Imperial Textile Company, Ltd.: Oriental Cotton Trading Company, Ltd.; and Oriental Rayon Company, Ltd., listed on inclosure hereto, shall comply with the provisions of and make reports required by referenced Memoranda listed in paragraph 1, above. Wherever reference is made in inclosure 1 and inclosure 2 to Memorandum referred to in subparagraph 1a, above, to the year 1944, it shall be amended to read 1945.
3. No requirement of this Memorandum shall be construed as placing the subsidiaries of the concerns named in paragraph 2, above, on the Schedule of Restricted Concerns referred to in subparagraph 1c, above.
FOR THE SUPREME COMMANDER:
JOHN B. COOLEY,
Colonel, AGD,
Adjutant General.
1 Incl: List of Subsidiaries Limited in Their Activitites and Required to Submit Reports.
MEMO FOR RECORD: (SCAPIN - 1008)
WFM/JMcIH/RA/gg
3 June 1946
1. Pursuant to the policy set forth in JCS Directive 1380/15, dated 3 November 1945, investigations are being made of concerns which are not on the Schedule of Restricted Concerns, inclosure to SCAP Memorandum AG 004 (8 Dec 45) ESS/AC (SCAPIN-403), subject: "Establishment of a Schedule of Restricted Concerns."
2. An investigation of the textile firms and their subsidiaries listed on attached Table A has disclosed the following information relative to the reorganization and control in this industry:
a. The giant spinning-weaving firms, by use of control associations, were able to completely dominate the textile industry. All aspects of production and sales were directed by control organizations which are dominated by the companies listed herein.
b. Direct control over sixty-nine (69) subsidiary companies, is held by the four (4) firms mentioned in paragraph 3, below. The subsidiaries are principally textile manufacturers, but also include many concerns totally unrelated to this field. Acquisition of a number of minor firms was made as a result of a wartime directive of the Japanese Government.
c. In 1943, with the increasing demand for use of every industrial resource, the majority of textile plants converted their production to war materials.
3. a. Daiwa Industrial Company, Ltd., (a subsidiary of Fuji Industrial Company, Ltd.); Imperial Textile Company, Ltd., (a subsidiary of Yasuda Hozensha); Oriental Cotton Trading Company, Ltd., and Oriental Rayon Company, Ltd., (subsidiaries of Mitsui Honsha), have previously been placed on the Schedule of Restricted Concerns. Subsidiaries of these subsidiary companies, listed on attached Table A, participated in the unethical business practices outlined in paragraph 2, above. The subsidiary concerns listed on attached Table A are, in fact, second degree subsidiaries and are not being added to the Schedule of Restricted Concerns, although it is considered desirable to maintain surveillance over them. Consequently, the attached Memorandum restricts their activities, required that they shall also comply with the provisions of pertinent directives and make the same reports required of companies on the Schedule of Restricted Concerns.
b. This surveillance procedure is established to prevent Zaibatsu interests from re-establishing themselves in the second degree subsidiaries. On the other hand, it is not considered desirable to have these companies subject to proposed more stringent action, such as purge of officers and directors until the reports called for have been examined.
c. The surveillance device is being used so that SCAP's activities in going into the detailed structure of Japan's industrial economy can be kept at the minimum consonant with the objectives of the Occupation.
4. The interests of USAFIK have been considered. This action does not affect the Korean area.
5. This is considered an administrative matter.
6. Concurrences: Legal Division, ESS (Lt. Col. E. R. Minnich); Industrial Division, ESS (Mr. G. T. Walker);
Import and Export Division, ESS (Mr. R. A. May).
1 Incl: Table A.
J. McI. H.
